Tag Archives: inflation

Health Care Costs

Consumer Price Index: Amid Disinflation, Medical Prices Increasing

BLSYesterday’s Consumer Price Index (CPI) release confirmed prices of medical goods and services continue to rise at a steady pace, despite the general deflationary environment. The CPI declined 0.1 percent from July to August (seasonally adjusted), and increased just 0.2 percent in the last twelve months.

Much of the disinflation is caused by dropping energy prices. Excluding food and energy, the CPI increased 0.1 percent last month and 1.8 percent over the last twelve months. Medical care, although flat last month, increased 2.5 percent over the last twelve months (see Table I). This is moderate by historical standards, but still excessive relative to current CPI. Continue reading Consumer Price Index: Amid Disinflation, Medical Prices Increasing →

Health Care Costs

Health-Related Producer Prices Tame in July

BLSThe Producer Price Index (PPI) for July increased more than expected, but was still benign. Health-related producer prices were tame last month.

Prices for pharmaceutical preparations, which have increased faster than other producer goods in the long term (rising 9.4 percent since July 2014), finally turned around and actually dropped 0.4 percent last month (See Table I). This was a bigger decline than prices for all final demand goods (-0.1 percent) or for all final demand (0.2 percent). Continue reading Health-Related Producer Prices Tame in July →

Health Care Costs

Producer Price Index: Pharma, Biologics Jump

The Producer Price Index (PPI) for June increased more than expected, as the effect of the drop in oil prices abated. As shown in Table I, producer price growth for health goods and services was in line with tame growth in overall PPI, which grew 0.4 percent on the month and dropped 0.7 percent on the year to June.

The exceptions were pharmaceutical preparations, which increased 2.5 percent on the month and are up 10.3 percent on the year; and biologic products (including diagnostics), which increased 3.1 percent month on month and 3.2 percent year on year. Continue reading Producer Price Index: Pharma, Biologics Jump →

Health Care Costs

Producer Prices: Health Goods & Services Lag

Last Friday’s Producer Price Index showed a jump from April to May of 0.5 percent (seasonally adjusted). When I last looked at the PPI, it looked like prices of health goods and services were outpacing other producer prices.

The latest data show them lagging (see Table 1). Although, looking at year-on-year data, pharmaceutical products, hospitals, and nursing homes have had relatively high price increases. Price inflation for health insurance has been moderate, according to the PPI. Continue reading Producer Prices: Health Goods & Services Lag →

Health Care Costs

Health Prices Outpace Other Consumer Prices

Today’s release of the Consumer Price Index (CPI) indicates that prices of health services are outpacing other consumer goods and services by a multiple. From February to March, the seasonally adjusted CPI increased 0.2 percent. Medical care services overall increased at twice that rate, 0.4 percent, while physicians’ and hospital services both increased by 0.6 percent.

Year on year, the situation is even worse. The CPI showed slight deflation of minus 0.1 percent, while prices of medical care services have increased 1.9 percent, physicians’ services 1.7 percent and hospital services a startling 3.4 percent.

With respect to health goods, price increases might be tapering. Although prices of medical care commodities increased 4.2 percent, year on year, they only increased 0.1 percent last month. Nonprescription drugs, medical equipment, and medical supplies actually had small decreases in prices last month.

Health Care Costs

Prices for Health Goods Rallying

As the economy slowly crawls its way back towards growth, inflation is well under control. However, healthcare inflation is rearing its head. Table 1 presents data from the February release of the Producer Price Index.

Over the last twelve months through January, producer prices increased by zilch, and actually decreased since last December. Prices of goods for final demand actually dropped 3.7 percent over the year. Pharmaceutical preparations, however, increased by 7.3 percent, and other healthcare goods also had higher inflation than other goods for final demand (which, I hate to state, also weakens the argument that the medical-device excise tax is having as negative an effect as the industry claims).20150219 PPI

 

Continue reading Prices for Health Goods Rallying →